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Customer Refuses to Endorse Her Checks

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We have a customer refusing to endorse her checks. She stated that it is our (Depository Bank) responsibility to stamp the back of the check "credited to the within named payee". I have not heard of this, nor can I find any information on customers refusing to endorse their checks for deposit.

Who is making the rules here? Generally, banks reserve the use of their "credited account within named payee" stamp for those rare cases in which an endorsement is inadvertently omitted. While it's true that banks will have the same rights in the checks as if the customer endorsed them based on UCC 4-205, it's also true that most laypersons don't know about that fine point. Accordingly, it's likely that some of the check writers won't take kindly to the fact that their payee hasn't endorsed the checks.

While 4-205 supplies the endorsement by law, I think an actual endorsement is to be preferred if only because it doesn't beg any questions.

I recommend you reserve this kind of "service" for customers who find it difficult, not inconvenient, to endorse their checks. Like someone with a broken arm, perhaps?

First published on 07/04/05

First published on 07/04/2005

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